California PFL Tax

[zz10957]

We had a baby last year, so me and my wife took parental/bonding leaves. I need some help in the options I need to pick in TT.

In my W2, box 14 has "CA VDI" of $x. My company payroll said as part of the PFL I received

$y - family leave

$z - parental leave.

I did not receive any 1099-G and received all my pay via regular paychecks from my employer.

In my wife's W2, box 14 has "CAPVDI" of $a. My wife's company payroll said as part of the PFL she received (in brackets the explanations of what these code mean)

$b - VD2 ("this refers to the voluntary plan for your disability claim that applied to your pregnancy disability period")

$c - CA PD FAMLV ("this refers to the voluntary plan for your paid family leave")

$d - CA LOA S PAY ("this refers to the leave of absence “top up pay” that you received from employer")

She too did not receive any 1099-G and received all her pay via regular paychecks from my employer.

In TurboTax, once I input the W2, there is a page which says "Let's check for uncommon situations" where there is a checkbox for "Paid family leave". I was hoping someone could guide me on whether I should select this or not because when I select this, my CA refund becomes a huge number which can't be right.

[BillM223]

California originally (and still does) ran Paid Family Leave through the EDD (Economic Development Department). When the EDD is involved, then at the end of the year, the EDD sends a 1099-G to the taxpayer.

In the meantime, the EDD developed the concept of a "voluntary plan", which provides a plan for short-term disability insurance and family leave that is run by the employer.

Note that when the employer does this, the plan must be approved by the EDD. In this case, distributions to the employee under this voluntary plan is treated taxwise as if it came from the EDD (taxable on the federal and excluded from tax for the state).

So you need to ask your employers two things:

1. Was your Voluntary Plan approved by the EDD?

2. Which of the box 14 describe distributions to the employee under that employer's Voluntary Plan? 

For example, in a discussion with the tax preparer hot line at the FTB, we came to believe that "$d - CA LOA S PAY ("this refers to the leave of absence “top up pay” that you received from employer")" was not part of the Voluntary plan that was approved by the EDD.

So, please go back to your employers and ask them questions #1 and #2. Then, when you know the amount of distributions from your Voluntary Plans, put this amount (for each of you) in the box in the CA interview that asks for "PFL Income Received From Insurance Company" (see below):